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Clegg Warns Cameron Doubts Over Role in EU Risk U.K. Jobs

January 15, 2013

Deputy Prime Minister Nick Clegg accused David Cameron of putting the U.K. economy at risk by fueling doubts over Britain’s future in the European Union.

Clegg, whose Liberal Democrat party governs in coalition with Cameron’s Conservatives, said the prospect of a referendum on Britain’s membership of the 27-country bloc could alarm investors and have a “chilling effect” on jobs and growth.

Cameron said yesterday he’ll set out how he plans to renegotiate Britain’s EU membership in a speech in the Netherlands on Jan. 18 and signaled he supports putting the outcome to a popular vote after the 2015 general election, with the government arguing to stay in.

“We should be very careful at a time when the British economy is still haltingly recovering from the worst economic shock in a generation to create a very high degree and prolonged period of uncertainty,” Clegg told BBC Radio 4 today. “Uncertainty is the enemy of growth and jobs.”

Clegg also questioned whether the prime minister’s plan to claw back as yet unspecified powers from the EU is achievable, since it would require the agreement of other EU nations. “I don’t agree with the premise that we can, on our own if you like, unilaterally simply rewrite the terms of our membership for this European club,” he said.

Not Enough

Cameron spoke with Swedish Prime Minister Fredrik Reinfeldt about the Europe speech last night and he plans to talk to Conservative ministers tomorrow, his spokesman, Jean-Christophe Gray, told reporters in London today. The call with Reinfeldt was “constructive and went well,” Gray said.

While it has been criticized by Clegg, other European politicians and the U.S. for raising questions about Britain’s future within the EU, Cameron’s proposal doesn’t go far enough for many in his party who want a referendum sooner than 2015 on a straight question of whether Britain should leave the EU. Cameron dismissed that as a “false choice” yesterday.

The premier chose the Netherlands because it is a “founding member of the EU” that is not “dissimilar” to the U.K., with “a strong global-trading, outward-looking history,” Gray said. The Sun newspaper reported last week that the speech will be made in The Hague.

“The beating heart of Britain is, we know we need to be in Europe, because we are a trading nation,” Cameron told ITV yesterday. “But we’re not happy with every aspect at the moment -- there’s too much interference. People want that to be fixed, they want more of a say. We shouldn’t be frightened to involve the British people in that.”

Referendum Conditions

Clegg, whose party is the most pro-EU of the three main political parties, said a referendum should be held if the EU rewrites its rulebook to accommodate closer integration among the 17 countries that use the euro.

“If there is a new treaty and that involves significant transfer of power then, of course, people should have a say,” Clegg said. “We do not know yet whether that will manifest itself in a new treaty. We do not know if that new treaty will ask new things of the United Kingdom.”

There is a tradition of British prime ministers going to the continent to make speeches on Europe. Tony Blair went to Warsaw in 2000 to make the case for an expanded EU. Winston Churchill called for a United States of Europe in Zurich in 1946 to rebuild the continent in the aftermath of World War II.

Thatcher Speech

Margaret Thatcher set out her European position in a speech in Bruges, Belgium, in 1988. That address is so idolized by Conservatives that one of the pressure groups against further EU integration is named after it -- The Bruges Group.

Cameron has promised his speech for months. On Dec. 10, he joked to journalists that it was a “tantric approach to policy making -- it’ll be even better when it does eventually come.”

The prime minister is under pressure from two sides. Many in his party argue that a more hostile approach to Europe would be popular with voters and Chancellor of the Exchequer George Osborne last week raised the stakes by warning that the EU had to change if Britain is to remain a member.

Meanwhile Philip Gordon, assistant secretary of state for European Affairs in President Barack Obama’s administration, last week warned Britain against a referendum, saying the U.K. staying in the EU is important to U.S. interests.

Gunther Krichbaum, a member of Chancellor Angela Merkel’s Christian Democrats who heads the German parliament’s European Affairs Committee, weighed in to suggest it was a bad approach to negotiations. “You cannot create a political future if you are blackmailing other states,” he told the Guardian newspaper.

‘Massive Disruption’

Business Secretary Vince Cable, a Liberal Democrat, described talk of a referendum as “a massive disruption and deeply unhelpful” at a time when the government is trying to persuade companies to invest in the U.K.

Cameron yesterday defended his decision to raise the question of Britain’s membership.

“This debate is happening anyway,” he told the BBC. “We have a choice as politicians: do we get out there, lead the debate, make a choice that I think will be right for Britain and right for Europe, or hide your head in the sand?”

His hand is being forced by pressure within his own party amid growing support from 2010 Tory voters for the U.K. Independence Party, which advocates withdrawal from the EU. Recent polls put UKIP on about 10 percent support.

Britain’s relationship with Europe has been the subject of two record-breaking Conservative rebellions since Cameron took office in 2010. On Oct. 31, the premier suffered his first House of Commons defeat after 53 of his lawmakers defied him to vote for a real cut in the EU budget, rather than the freeze he’d said he was seeking. A year earlier, 81 Conservative lawmakers voted for a referendum on pulling out of the EU.

Polls suggest voters wouldn’t support withdrawal from the EU in the referendum Cameron proposed. A YouGov Plc (YOU) survey of 1,995 adults conducted Jan. 10-11 found more people saying life outside the EU would be worse than better. And while they initially said they would vote for Britain to leave by 42 percent to 36 percent, asked how they would vote if he had conducted a renegotiation and was advocating staying in, they said they would support membership by 50 percent to 25 percent.

To contact the reporters on this story: Robert Hutton in London at rhutton1@bloomberg.net; Gonzalo Vina in London at gvina@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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